Illinois Property in a Dissolution

It is common for a couple going through a dissolution to decide about dividing their property (and debts) themselves, rather than leave it to the judge. But if a couple cannot agree, they can submit their property dispute to the Court, which will use state law to divide the property.

Division of property does not necessarily mean a physical division. Rather, the Court awards each spouse a percentage of the total value of the property. (It is illegal for either spouse to hide assets in order to shield them from property division.) Each spouse gets items whose worth adds up to his or her percentage.

Courts divide property under one of two schemes: equitable distribution or community property.

  • Equitable distribution. Assets and earnings accumulated during marriage are divided equitably (fairly). Equitable distribution principles are followed everywhere (including Illinois) except the community property states listed just below.
  • Community property. In Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin, all property of a married person is classified as either community property, owned equally by both spouses, or the separate property of one spouse. At dissolution or divorce, community property is generally divided equally between the spouses, while each spouse keeps his or her separate property.

Illinois is an “equitable distribution” state. This means there is a presumption of a 50-50 division of marital property, but also that when parties are unable to agree as to the division of property, property is distributed in an equitable fashion, which does not necessarily mean equal, but rather, what is fair to both parties.

How is property divided at divorce?

The Court encourages the parties to come to agreement themselves on the division of property to avoid having the Court make such decisions for the couple.

Under the Illinois Marriage and Dissolution of Marriage Act, all property acquired during the marriage or civil union is assumed to be marital (or civil union) property.  Illinois Compiled Statutes 750 ILCS 5/503 specify the following factors the Court will consider in coming to an equitable determination:

(d) In a proceeding for dissolution of marriage or declaration of invalidity of marriage, or in a proceeding for disposition of property following dissolution of marriage by a court which lacked personal jurisdiction over the absent spouse or lacked jurisdiction to dispose of the property, the court shall assign each spouse’s non-marital property to that spouse. It also shall divide the marital property without regard to marital misconduct in just proportions considering all relevant factors, including:

(1) the contribution of each party to the acquisition, preservation, or increase or decrease in value of the marital or non-marital property, including (i) any such decrease attributable to a payment deemed to have been an advance from the parties’ marital estate under subsection (c-1) (2) of Section 501 and (ii) the contribution of a spouse as a homemaker or to the family unit;

(2) the dissipation by each party of the marital or non-marital property, provided that a party’s claim of dissipation is subject to the following conditions:

(i) a notice of intent to claim dissipation shall be given no later than 60 days before trial or 30 days after discovery closes, whichever is later;

(ii) the notice of intent to claim dissipation shall contain, at a minimum, a date or period of time during which the marriage began undergoing an irretrievable breakdown, an identification of the property dissipated, and a date or period of time during which the dissipation occurred;

(iii) the notice of intent to claim dissipation shall be filed with the clerk of the court and be served pursuant to applicable rules;

(iv) no dissipation shall be deemed to have occurred prior to five years before the filing of the petition for dissolution of marriage, or three years after the party claiming dissipation knew or should have known of the dissipation;

(3) the value of the property assigned to each spouse;

(4) the duration of the marriage;

(5) the relevant economic circumstances of each spouse when the division of property is to become effective, including the desirability of awarding the family home, or the right to live therein for reasonable periods, to the spouse having custody of the children;

(6) any obligations and rights arising from a prior marriage of either party;

(7) any antenuptial agreement of the parties;

(8) the age, health, station, occupation, amount and sources of income, vocational skills, employability, estate, liabilities, and needs of each of the parties;

(9) the custodial provisions for any children;

(10) whether the apportionment is in lieu of or in addition to maintenance;

(11) the reasonable opportunity of each spouse for future acquisition of capital assets and income; and

(12) the tax consequences of the property division upon the respective economic circumstances of the parties.

Generally, dissipation is the use of marital funds or property by one party for his or her own benefit (not something that benefits the marriage). There is a limited time period where dissipation can be claimed, which is usually during the time period when the marriage is going or gone through the irretrievable breakdown.  Dissipation must usually be claimed by filing a notice of intent with the Court.  Such issues are not typically part of an uncontested dissolution action, as disputes between the parties arise.

How do we distinguish between marital (or civil union) and non-marital (or non-civil union) property?

In Illinois, “marital property” or “civil union property” is typically all real and personal property acquired by either party subsequent to the marriage or civil union, and presently owned, except property determined to be separate property.

Illinois Compiled Statutes 750 ILCS 5/503 specify that non-marital (or non-civil union) property is:

(1) Property acquired by gift, legacy or descent;

(2) Property acquired in exchange for property acquired before the marriage or civil union in exchange for property acquired by gift, legacy, or descent;

(3) Property acquired by a spouse after a judgment of legal separation;

(4) Property excluded by valid agreement of the parties;

(5) Any judgment or property obtained by judgment awarded to a spouse from the other spouse;

(6) Property acquired before the marriage;

(7) The  increase in value of property acquired by a method listed in paragraphs (1) through (6) of this subsection, irrespective of whether the increase results from a contribution of marital property, non-marital property, the personal effort of a spouse, or otherwise, subject to the right of reimbursement provided in subsection (c) of this Section; and

(8) Income from property acquired by a method listed in paragraphs (1) through (7) of this subsection if the income is not attributable to the personal effort of a spouse.